Caterpillar posts strong results despite poor mining sales
Caterpillar (NYSE:CAT), the world's largest maker of mining and construction equipment, posted Thursday Q3 financial results that beat analysts' expectations, causing the stock to skyrocket.
Earnings per share came in at $1.63 on sales of $13.549bn, up from the $1.45 a share and $13.42bn in revenues reported a year earlier.
Forecasters were expecting a year-on-year fall in sales and revenues to $1.36 and $13.2bn.
The stock was up 6.8% in premarket trading (at 8:00 am ET).
The company also raised its earnings forecast for the year from $5.75 to $6.00 a share as the economic recovery in the U.S. continues to drive sales of equipment used in the energy and transport sector.
The equipment maker said the profit growth was driven by strong demand from the construction and oil and gas industries in North America, which offset continued weak demand from the global mining industry.
As a global supplier of construction and mining equipment, Caterpillar is considered a reliable bellwether of economic activity.
"We're pleased with the third-quarter profit improvement considering world economic growth remains slower than we'd like," CEO Doug Oberhelman statement. “We are confident that, when we see more significant economic growth around the world, our consistent focus on operational performance will have prepared us to deliver even better results."
Caterpillar has been aggressively cutting cost following a slowdown in mining that has hit in sales for the last two years.